The Challenge
A leading U.S. retailer faced critical capacity and inventory challenges within its distribution network, hindering its ability to keep up with exponential retail demand growth. Though eCommerce growth accelerated year-over-year, distribution centers were at maximum capacity, leading to delayed replenishment, stockouts, lost sales and unhappy customers.
The Solution
The retailer partnered with Flexe to set up mixing centers in nine regional markets to enable one-day or less replenishment of fast-moving SKUs. Flexe offers the largest flexible warehousing network in North America and was the only partner able to stand up high-volume mixing centers in critical markets through a single technology integration.
Flexe worked closely with the retailer to optimize the mixing centers for high inventory throughput to place the right inventory in stores when needed. Outbound logistics optimized multi-store deliveries by volume, weight and routes.
Flexible Warehousing Infrastructure allowed the retailer to scale up and down cost-effectively across demand cycles.
Results
Now 1,200 of the retailer’s stores receive next-day inventory replenishment. The nine-node distribution network launched in just eight weeks and can scale to meet additional demand. They now replenish the right amount of inventory daily.
The mixing centers exceeded expectations for oversized inventory. Projected to handle only 10% of oversized pallets, Flexe sites now process 70% of oversized pallets, demonstrating substantial flexibility.
The retailer plans to add mixing centers within 350 miles of all 2,000+ stores. Flexible Warehousing Infrastructure provides the retailer with the agility to expand into new strategic locations fast—without capital investments.
Compare fixed vs. flexible storage costs
